Why is my compact shooting terrible videos at 720p HD?

I have a Nikon L27 compact camera, and I'm trying to shoot videos with it. I've set the setting to 720p (this appears to be the highest resolution setting), and on the 2.7 inch display screen it looks fine… Although that could be because the screen is so small. However simply transferring the files to my computer and watching them fullscreen there (keeping in mind that my screen is only 10.1 inches!) they look really, really grainy and awful. Why is this and how can I fix it? Also are there any fairly cheap camcorders you could recommend?

Yes, 720p should show on your screen without being grainy. Take a short video outside in the daylight. If it doesn't show properly, the camera has a problem and you should contact Nikon.

Don't know what "fairly cheap" is to you, but you can get camcorders at about $250 that can give excellent results.

If they look grainy/noisy it's probably because there's not enough light. Where are you taking the videos?

Resolution is not what makes videos look good. Proper lighting is what makes videos look good.

Indeed a camcorder is the way to go. You can do much more adventurous camerawork with a camcorder than with a still camera which also has a video facility.

The light is the major cause of problem. Lighting can make videos really bad or really good.

Can you please answer my comment to this question